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Bringing principles down to statutory reality is a tough-minded

It means making decisions-practical decisions on the balance of advantage and disadvantage-in the face of legal ambiguity, economic variation, and the human limitations of administration. It often means choosing the lesser evil-and making the choice work.

I have been asked by the chairman of both of these committees to discuss the constitutional problems suggested by the pending bill. I undertake this discussion in what I hope will be a realistic way, on the assumption that these committees are interested in finding a way to insure decent labor conditions for the submerged third of our population rather than in regretful excuses why nothing can be done.

At the outset there is a popular and widespread impression that Congress rightfully has nothing to do with labor standards or working conditions in industry and that any effort to improve them must be a subtle encroachment on local government and a subversion of constitutional limitations. This misunderstanding is laid at rest by the recent statement of Chief Justice Hughes writing for a unanimous Court that

The Congress in exercising the powers confided to it by the Constitution is as free as the States to recognize the fundamental interests of free labor.

CONGRESSIONAL POWER TO REGULATE COMMERCE AMONG STATES

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The power confided to Congress which this bill proposes to exercise, and in exercising, to recognize the fundamental interests of free labor, is the expressly given power to regulate commerce among the several States. The constitutional basis for the proposed legislation will appear from an examination of the scope of this power.

The Supreme Court has upheld various types of regulation of interstate commerce upon several distinct constitutional theories. The attempt is to consolidate in a single bill all hopeful approaches to constitutionality, each complete in itself, so that if one or more falls at the hands of the Court, we will not be left for an interval while a new bill is being adopted. The result is that there is some overlapping in its provisions but no inconsistency in its operation or its objectives.

Different judicial theories of the commerce power, which this bill invokes may be classified as follows:

1. There is the power directly to regulate or prohibit movement across State lines of goods deemed for any reason to offend against sound national policy. This power has been applied in many cases and denied in but one, the famous Child Labor case to be discussed later. This bill invokes that power to regulate and prohibit by directly forbidding transportation of the products of the labor of children under 16 years of age, which ought not to be accepted in any fair market, and products made under conditions where workers are denied the right of self-organization by fear of labor spies and where their right to strike and to enforce collective bargaining is rendered ineffective by the use of professional strikebreakers. Such use of espionage and of professional strikebreakers is both a provocation of violence and an excuse for it, and offends against our national policy.

2. Congress has the power to regulate competition in interstate commerce. It has exercised this power without question since the adoption of the Sherman Antitrust Act in 1890, and again through

the Clayton Act and the Federal Trade Commission Act. In the exercise of this power Congress has prohibited certain practices deemed injurious to competition in interstate commerce. It has prohibited many acts, in themselves local, by employers engaged in productive industry, but which tended to monopoly or to destroy competition. Under this power Congress has prohibited, under certain circumstances, the acquisition of the stock of one corporation by another. It has defined and prohibited unfair methods of competition. What, then, may be said of the employer who cuts wages, employs children, and sweats labor, for the purpose of gaining a competitive advantage in marketing his product in an interstate market? As pointed out by Prof. Thomas Reed Powell of the Harvard Law School, and by other students of constitutional law, since Congress has the power to regulate conditions of competition as it has done through the antitrust acts, it may likewise prohibit the securing of a competitive advantage in interstate commerce through the adoption of oppressive and sweatshop labor conditions.

It will be noted that part IV of this bill proceeds upon this theory and its provisions may be sustained, without overruling the Child Labor case. The factual basis for this view is that by prohibiting the use of substandard labor conditions by those who compete with employers who use fair labor standards, the great majority of employers who really desire to treat labor fairly are thereby protected against the unfair methods of competition of those who utilize sweatshop methods to gain a competitive advantage.

And, since Congress may regulate the conditions of competition in interstate commerce, it may protect the fair employer shipping in interstate commerce against the unfair competition of even his interstate competitor under the doctrine of the Shrereport Rate cases (234 C. S. 342), a case to which the Supreme Court had occasion to allude with approval in the recent Wagner Act decision.

3. The power to regulate commerce includes the power to eliminate labor conditions which lead to labor disputes which will directly burden or obstruct commerce (National Labor Relations Board v. Jones & Laughlin). This power is invoked in eliminating excessive hours, inadequate pay and child labor insofar as they tend to provoke such labor disputes.

4. The power to regulate commerce is held to include the power to prohibit transportation of goods into States in violation of the laws of such States and making such interstate goods subject to such State laws. This doctrine is supported by the decisions involving prisonmade goods (Kentucky Whip and Collar case, Jan. 4, 1937, and hitfield v. Ohio, 299 U. S. 431). This bill invokes this constitutional power by prohibiting consignment of goods into a State is produced under conditions that would have been unlawful within that State.

5. The power to regulate commerce has been held to include power to eliminate a condition which affects the movement of goods, the price of goods, or which causes undue price fluctuations in interstate commerce. This doctrine is set forth in the cases relating to the regulations of stockyards and grain exchanges (Olsen case, 262 U.S. 1, Stafford case, 258 U.S. 495). This bill invokes this power by eliminating from interstate commerce goods produced by substandard labor conditions which affect interstate commerce in the manner stated.

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6. The power to regulate interstate commerce has been held to include the power to regulate conduct intended to divert or substantially affect the movement of goods in interstate commerce. This is the doctrine of the Coronado Coal case (268 U. S. 295). This bill invokes such power to regulate such substandard labor practices as are found to be the result of an intention to divert the movement of goods in interstate commerce.

It will be observed that these theories of the interstate commerce power, as laid down by the Court, are complicated and overlapping and that some could be directly and automatically applied while others could be applied only where circumstances were found to warrant. It was therefore inevitable that any bill which tried to use these available weapons to fortify itself against the constitutional attack which labor and commerce legislation always faces, should to a considerable extent sacrifice simplicity. For neither the subjectmatter of the bill nor the legal theories underlying it can with practical safety be reduced to any one simple formula. But the bill is believed not to be conflicting within itself or self-defeating.

In addition to rigid and direct exclusion from the channels of interstate commerce of those products made under conditions deemed oppressive at any time and under any circumstances, such as labor of children under 16, spied-upon labor, or strikebreaker-brow-beaten labor, there is also included administrative proceedings before an independent board, similar to the National Labor Relations Board or the Federal Trade Commission.

As President Roosevelt has stated: “Even in the treatment of national problems there are geographical and industrial diversities which practical statesmanship cannot wholly ignore.” Portions of the bill relating to wages and hours would become operative as and when the Board created by the act orders their application. This bill does not plunge the Nation headlong into a rigid and widespread policy of regulating wages and hours. It permits the building up a body of experience and prevents the extension of regulation faster than capacity properly to administer is required. The investigtions of the Board will also provide the evidence and the findings upon which the Government can rest its argument if the constitutionality of the act is assailed.

The proposed bill, therefore, is-except as to the Child Labor case to be dealt with later-backed by long established precedents defining Federal power to regulate interstate commerce. Congress may so use the power as to stop interference from State laws, and it can equally protect it against employer lawlessness. It can foster the legitimate and helpful trade as well as stop the unwholesome. To quote again from the Chief Justice in the Kentucky Whip case:

The power to prohibit interstate transportation has been upheld by this Court in relation to diseased livestock, lottery tickets, commodities owned by the interstate carrier transporting them except such as may be required in the conduct of its business as a common carrier, adulterated and misbranded articles, under the Pure Foods and Drugs Act, women for immoral purposes, intoxicating liquors, diseased plants, stolen motor vehicles, and kidnaped persons.

A commerce clause broad enough to protect the children of the rich from kidnaping would seem not to be abused if it should also protect the children of the poor from exploitation. As Justice Holmes said, with the approval of Justices Brandeis, Clark, and McKenna, it was not intended to leave Congress free to prohibit traffic between States

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in lottery tickets and strong drink, but not to prohibit the interstate shipment of "the product of ruined lives."

THE CHILD LABOR DECISION AND STATES' RIGHTS

The power of Congress to enact the bill is clear, under the decisions, both old and recent, except for the denial by the Supreme Court in the Child Labor case of the most simple and clear of all these theories. In 1918 by a 5-to-4 vote, the Supreme Court in Hammer v. Dagenhart (247 U. S. 251) held invalid an act of Congress prohibiting interstate transportation of goods manufactured in violation of certain childlabor standards.

In view of the President's recommendation of legislation of the type proposed in the pending bill, and of the unique constitutional situation presented by that Supreme Court decision it has seemed appropriate for the Department of Justice to furnish these committees with the result of our studies of this bill, notwithstanding precedents against so doing

The Court's decision sheltering child labor from Federal action could affect only a part of the bill at most. But if it were overruled it would permit a simple and more understandable dealing with the question.

The child labor decision was promulgated by a bare majority of numbers. They were Mr. Chief Justice White and Justices Van Devanter, Pitney, McReynolds, and Day who wrote the prevailing opinion. A ringing dissent was written by Mr. Justice Holmes and supported by Justices McKenna, Brandeis, and Clark, who could not be regarded as a minority in prestige.

Legal scholarship received the decision with indignation and derision which time bas not softened. A leading authority on the Constitution has said:

There is certainly nothing in the Constitution which requires the decision of the majority. It is wretchedly supported by the argument of the opinion. The assertion (which the majority made) that "the act in its effect does not regulate transportation among the States” is obviously unfounded (Thos. Reed Powell, 3 Southern Law Quarterly 175).

Others pointed out that if a State attempted to stop the shipping in or shipping out of child-labor-made goods it would be held to be interstate commerce and void while if the Nation prevented the shipment it was held not interstate commerce and void. (Gordon, 32 Harvard Law Review 45–51-52). The game so far as the children were concerned, seemed to be, heads they lost and tails they didn't win.

We owe it to our times to challenge the perversion of our Constitution injected into our law by the child-labor decision. This bill would challenge it. We should give the courts a chance to remove this blemish from our judicial history.

The doctrine of the majority in the Child Labor case belongs to the same dark era of legal thought as the decision holding that the minimum-wage law was unconstitutional (Adkins v. Children's Hospital, 267 U. S. 525, decided in 1923). The Court recently said that the importance of the minimum-wage question, the close division of the Court by which the former decision was reached, and “the economic conditions which have supervened" in the years since it was decided, made it “not only appropriate, but we think imperative” that the subject should receive "fresh consideration." Every condition that led to fresh consideration of the Minimum Wage case with equal force renders not only appropriate but imperative fresh consideration of the child-labor decision. Reconsidering the minimum-wage case, which it had only a few months before followed as good law in striking down the New York statute, the Court held in the language of the Chief Justice that the 1923 case and of course the 1936 case to the same effect—"was a departure from the true application of the principles" of law and frankly and courageously said “Our conclusion is that the case of Adkins v. Childrens' Hospital should be, and it is overruled."

And in the National Labor Relations Board v. Jones and Laughlin, the Court, without expressly overruling earlier cases, plainly receded from decisions such as Carter v. Carter Coal Company (298 U. S. 238), which had seemed to cramp the interstate commerce power into its lowest visible dimension.

The Court seems again to have been persuaded as Chief Justice Taney said that it is "the law of this Court that its opinion upon the construction of the Constitution is always open to discussion when it is supposed to have been founded in error, and that its judicial authority should hereafter depend altogether upon the force of the reasoning by which it is supported(Passenger cases, 7 Howard 283, 473).

In face of the willingness of the Supreme Court to decline to let obsolete precedent limit the exercise of its own reason, Congress may with propriety decline to let such decisions stall legislative reason. Had not the legislators persisted in challenging the minimum-wage cases, their inaction and acquiescence would have prevented the Court from amending its doctrine. Nothing but a challenge to the child-labor decision will enable the Court, even if it is so minded, to correct the old decision, now without support in scholarship, reason, or enlightened public sentiment. It is the distinguishing feature of judge-made law that it is made only by the case method. The Court must await another case to correct an error. It has no technique for initiating reconsideration of closed cases. If old decisions are not challenged by law makers, judicial development is arrested and advancement of legal science stops.

Hence, I have no hesitation in urging that the time has come when the child labor decision should be challenged and reargued. We may reasonably entertain the hope that Hammer v. Dagenhart will be laid to a tardy and unmourned repose beside the lifeless remains of Adkins v. Children's Hospital.

STATES' RIGHTS

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In view of the frequent confusion on the subject it is due to those considering this bill to analyze the effect which it has upon the reserved powers of the States.

Let us assume each State as completely sovereign as a nation could be. No State would then have any right to send its goods into another State. Each State would have the right to stop all incoming goods at its borders, to exclude any goods unfairly competing in its own market, or to lay a tariff on those admitted to equalize any advantage that the incoming goods had over its own producers. The exercise of this right by the colonies threatened to disrupt commerce and to divide our people. The exercise by the several States of their own

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